Offshore wind power investors can sell entire projects in Vietnam: draft decree

A draft decree on offshore wind power being compiled by Vietnam’s Ministry of Industry and Trade will facilitate investors to sell their projects or stakes.

Accordingly, the sales must fulfill term 1 of Article 26, Electricity Law 2024 regarding national security-defense and information safety of the projects.

The sales must also comply with the Investment Law, the Law on Enterprises, and the Law on Vietnamese sea, as well as other relevant laws.

For projects with foreign investors, the sales must seek approvals from the Ministry of National Defense, Ministry of Public Security, and Ministry of Foreign Affairs.

For not-yet-operational projects, the transactions must comply with the regulations on past experience and financial capacity of foreign investors, the participation of state-owned enterprises, and commitments to using domestic supplies and services.

Specifically, first, foreign businesses must have experience in investing and developing at least one operational offshore wind power project in Vietnam or in the world.

Second, regarding financial capacity, the foreign investor must contribute at least 15% of the project’s total investment capital, and the foreign investor's equity must be equivalent to at least 20% of the capital contribution.

Third, the project must have the participation of Vietnam’s state-owned enterprises, which hold at least 5% of the charter capital of the entity conducting the project.

Fourth, the investors must also commit to utilizing domestic supplies (workforce, service, products) during investments, construction and operation phases, on the basis of ensuring the quality, schedule, and price competitiveness.

For other cases, the conditions are the third and the fourth points mentioned above.

The Electricity Law 2024 stipulates that transfers or sales of stakes at offshore wind power projects are permitted, with the Government providing further details. This is a key change as some draft versions of this law stipulate that institutions and individuals as project investors cannot transfer more than a 49% stake of their projects prior to their operation.